MULTI CHANNEL CUSTOMERS EXPERIENCE IN RETAIL BANKING. Presented by: Kalidas Ghose, Director of Retail Banking Division, VP Bank

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1 MULTI CHANNEL CUSTOMERS EXPERIENCE IN RETAIL BANKING Presented by: Kalidas Ghose, Director of Retail Banking Division, VP Bank

2 Customers are not loyal to the brand They are loyal to the service 2

3 Factors impacting consumer behavior in retail banking Apart from pricing, customers behavior is affected by a complex combination of internal & external factors NEEDS, WANTS, and HOOK Matching their needs Competitive pricing Convenient, quick Trustworthy brand Attractive loyalty benefits Personalization NEEDS WANTS HOOK New customers Choose a bank to serve needs Stay or Leave Traditional Alternative Hi- Tech EXPERIENCE WITH BANK VIA SALES & SERVICE CHANNELS Branch ATM Telesales Direct Sales Institutional Mobile Internet Social Media Key success factor for bank is to provide consistent offers and service via multi-channels. Consistent experience builds trust in customers. Existing customers 3

4 Tech. development fuels for today retail banking context ATM FUNDAMENTAL FEATURES (Cash with drawal, bill payment, transferring money, etc. ) SEMI-ADVANCED (Mobile phone top-up, loading monetary value into stored value cards, purchasing, etc.) ADVANCE Video conferencing with human tellers Biometrics (authorisation of transaction based on fingerprint) Envelope-free cheque/cash acceptance Bar code scanning Coordination of ATMs with mobile phones Nearly complete transaction capabilities 24 hours access Easy to use Supporting human interaction Rich information on personal account Mobile Banking & Online Banking ACCOUNT INFORMATION (mini statements, alerts on account activity, access to bank product statement, etc.) TRANSACTION (Fund transfer, bill payment, check remote deposit) INVESTMENT (Portfolio management, real-time stock quotes, personalized alerts, etc.) SUPPORT (Status of application, ATM location, , etc.) CONTENT (Loyalty related, location based services, etc.) Customers can make transaction and access their accounts anytime from anywhere 4

5 Increasing role of social media in Banking Impact of Social Media Banking on Customer Retention, by Age and Region Banking on social media ACCOUNT INFORMATION Account status/history and standing orders SERVICING Live interaction Service request submission Banks current status in implementing Social Media Banking Functionalities SOCIAL/COLLABORATION GPS /Location based services Online community forum Engage Personal/ Social network Gamification TRANSACTING Bill payments Payments Origination Update personal information INFORMATION GATHERING Product information Branch/ATM Location Source: Capgemini Financial Services Analysis 2014; 2014 Retail Banking Voice of the Customer Survey, Capgemini Global Financial Services 5

6 Shift of banks focus and the role of branch Before Current ATM ATM Partners BRANCH Call center and Direct Sales Partners Data & Analytics Branch Mobile Internet Mobile Internet Call Center & Direct Sales Bank started focusing on ATM and Internet Reducing overall costs Making branch profitability a challenge Reduction branches in developed market though developing market is still seeing an increase 6

7 Shift of banking intensity Transaction Intensity High High ATM ATM Internet Banking Internet Banking Mobile Banking Call Center Branch Banking Call Center Mobile Banking Branch Banking Low 2013 High Low 2020 High Source: Timetric analysis incorporated with in-house observation Sales Service Intensity Branch still plays a dominant role but transactions are shifting to alternate channels 7

8 Online & offline activities for a typical day of a working parent People spend at least half of their life for online activities Big data collected from multi channels (web, mobile, POS) can describe a customers in full. Banks can tailor message and offer to individual customers to increase conversion rate. Graphic: Deloitte University Press DUPress.com 8

9 Digital channels as Marketing and CRM tools Collecting response 1 Social Media Blogs Facebook Twitter, etc. Forums Reviews Likes, comments, votes, follows 2 Integrated web intelligence The web visited Research Purchase Path 3 POS and ATM Purchases made at POS Activities done at ATMs BIG DATA ANALYTICS CUSTOMERS SEGMENTATION; CONTENT DEVELOPMENT; MARKETING CHANNEL SELECTION & PERSONALIZATION Feedback Social Media Web POS & ATM 9

10 Customers behavior in today global retail banking with local outlook on digital trend Channel use (% who use channel at specified frequency) Online/Internet 20% 37% 21% 8% 14% Mobile 10% 20% 18% 12% 40% 3% Call center 9% 18% 33% 37% ATMs 9% 49% 29% 7% 6% 4% Branch or office 20% 37% 29% 10% Daily Weekly Monthly Few times a year Almost never/never Source: EY Global Consumer Banking Survey 2014 Vietnam 39.7 mil internet users by 14 end (10% CAGR since 10) 31+ mil smart-phone owners 95% of smart-phone users researching products via their phone and 60% of smart-phone users made purchase via their phone. Mobile and online banking has full potential to growth (Source: wearsocial.sg and internetlivestats.com) Percentage of channel preference by task among all customers Sales 65% 7% 4% Advice 54% 22% 3% Make deposit 52% 3% 28% Buy/sell investments 49% 6% 5% 34% Report a problem/obtain a status 40% 30% 4% Administrative 30% 5% 8% 50% Bill payment/transfer 20% 3% 16% 55% Balance inquiry 12% 6% 21% 50% Branch Call Center ATM Online/Internet Mobile Others Source: EY Global Consumer Banking Survey % 14% 14% 20% 2% 2% 5% 2% 2% 1% 3% 3% 5% 1% 3% 4% 4% 2% 10% 1% 10

11 Imperative of new age retail banking Having omni channel strategy Source: Example of omni channel from Genpact.com 11

12 Imperative of new age retail banking Having CRM Platform to integrate channels seamlessly ONLINE CHANNELS ONLINE BANKING MOBILE BANKING SMS BANKING SELF SERVICE KIOS/ATM SOCIAL BANKING BANK USERS BRANCH ALTERNATE SALES CHANNEL CONTACT CENTER OPERATIONS MARKETING BUSINESS INTELLIGENCE CENTER Know your customers Contact Center Automation Customer Retention Salesforce automation and lead management Contact & Account Management Service request and Complaint management Marketing & Campaign Management Comprehensive view of customer Prospect Management Loyalty Management Account Origination Master Data Management Branch Automation Social Media Integration Online Setting Source: Example of Veripark CRM Platform 12

13 Imperative of new age retail banking Using channels as marketing & customer service tool with support of solid customer analytics Collecting response 1 Social Media 2 Integrated web intelligence 3 4 POS, Mobile Branch & and ATM Alternative sales channels BIG DATA + CRM INFORMATION ANALYTICS CUSTOMERS SEGMENTATION; CONTENT DEVELOPMENT; MARKETING CHANNEL SELECTION & PERSONALIZATION Feedback A B APPLICATIONS Customers made frequent purchases (store or brand) ANA- LYTICS Detects as favorite shops/brand Send promotions notification from the brand/store. Customers log-in mobile app to see detailed offer ANALYTICS Calendar synced with mobile banking app App sends notifications that today is mom s birthday (not applicable for 65+) Customers log-in mobile apps to see detailed message Mobile Banking App Providing gift options based on promotion & historical data Pop-up message Would you like to spread the love? Advise me please I already had plan for it Mobile Banking App Please stop this reminder Social Medial POS & ATM Linked to the list + update choice of customers in database Update rejection in database Stop reminder for mom Web Mobile & SMS Branch Alternate Sales Channel C ANA- LYTICS Calculating amount of most frequently withdrawal in latest 3 months. Pop-up message Would you like to withdraw 1 million as usual? 13

14 VP Bank Practice Growing customers base via multi-channels Growing customers base Grew by 40% Affluent Tending towards in first half 2014 Mass Affluent Upper Mass 80% annual growth Mass Age: years old Majority: Household income of 7 Mil and above (average 15 Mil) Needs: Various Transaction solution Savings Consumption loans Home purchase/auto purchase Business loans Investment Want: service/product to be convenient, accessible, flexible, fast Feedback Servicing VPBank Sales and Servicing Channels Internet Institution Mobile Branch Direct Sales ATM Telesales Feedback Servicing Protect -ion Transaction Co-branded Int. Dr Card Int. Dr. Card Prepaid Card Executive Package Account Debit Card Payroll Online Saving Acc. Savings Term Deposit Flexible Saving Acc. Unsecured Personal Loans Credit Card Overdraft Borrow Two Wheelers Loan Consumption Loan Home/Housing Loan Consumer Durables Loan Study Loan Household Business Loan Passbook Loan Auto Loan Investment Leveraged investment Mutual fund Auto Ins. Home Ins. Universal Life Term Life Pension Plan Education Plan Health Ins. Travel Ins. 14

15 VP Bank Practice From multichannel to omni channel OMNI CHANNEL STRATEGY FRAMEWORK 1. Channel Assessment 2. Customer segmentation 3. Channel operating model defined 4. KPIs for Channel Management 5. Multichannel implementation roadmap MULTI CHANNEL Mobile Mobile Internet Branch ATM Internet Branch ATM Institution Direct Sales Telesales Institution Direct Sales Telesales A. New Channel on boarding B. Channel optimization C. Channel Migration D. Channel Integration E. Channel Collaboration Focus for future development 15

16 VP Bank Practice Channel usage for service Percentage of channel usage by task among all customers 1% Sales 74% 25% Difference % ('13 - '14E) Difference % ('14E- '15E) Highest contribution Highest difference Online/Internet 1% Mobile 1% Advice 98% 2% Online/Internet 2% ATM 1.5% Make deposit 90% 6% 4% Call Center -1% Online/Internet 3% Report a problem/obtain status 8% 87% 5% Branch/Branch based -8% Online/Internet 3% Bill payment/transfer 28% 21% 36% 15% Branch/Branch based -2% Online/Internet 5% Balance inquiry 3% 11% 20% 52% 14% Branch/Branch based -5% Online/Internet 2% Branch & Branch-based Call Center ATM Online/Internet Mobile Alternate sales channel Capturing customers needs of convenience and fast service, we increase focus on digital channels and create channels integration to improve customer services 16

17 THANK YOU